Lessons learned from the Affordable Requirements Ordinance

Expanding Alternatives for Expanding Access to Housing

The solution to Housing Affordability in Chicago cannot be achieved by limiting the supply of housing.  Instead, we must make sure Chicago has enough supply of housing for everyone who wants it, at a price they can afford, especially low and moderate income residents.  Doing this requires broad based, city-wide solutions, for all neighborhoods.

Limiting new development forces new residents into the neighborhoods, competing for housing with existing residents, and thus raising rents for all and displacing naturally occurring affordable housing.

The Chicago City Chapter of the Home Builders Association of Greater Chicago, funded by a grant from the National Association of Home Builders, engaged the Multi-Family Practice of Cushman and Wakefield to conduct a thorough examination of the market impact of the Affordable Requirements Ordinance (ARO) on affordability.

What that research found was that increasing ARO requirements had an opposite effect, forcing the cancellation of new developments that could have provided both affordable and market rate housing much needed in Chicago.  As a result, Chicago lost more than $1 Billion in immediate economic impact on construction wages and suppliers.  Further, Chicago lost $500 million in future property taxes for schools, parks, fire and police.  Chicago cannot afford mistakes like that.

Please take the time to read the Cushman Wakefield Research Report and the Housing Affordability Solutions offered by HBAGC.